Is it any wonder that many small and medium sized businesses are moving out of California? In the recent elections, California Voters Sock It To The Rich. As the Wall Street Journal noted, some are promising businesses a better life elsewhere. Being courted must be refreshing but it is important for a company and its owners to have reasonable expectations and to budget for drilling down into Californias rules.

After all, leaving is not always easy. A California resident is anyone in the state for other than a temporary or transitory purpose. See FTB Publication 1031. Plus, it includes anyone domiciled in California who is outside the state for a temporary or transitory purpose. The burden is on you to show youre not a Californian. If youre in California for more than 9 months, you are presumed a resident.

Yet if your job requires you to be outside the state, it usually takes 18 months to be presumed no longer a resident. Your domicile is your true, fixed permanent home, the place where you intend to return even when youre gone. You can have only one domicile, but many facts are relevant. Start with where you are employed and where you own a home.

If you own several, compare size and value. Consider your homeowners property tax exemption, where your spouse and children reside, etc. Your days inside and outside the state are important, as is the purpose of your travels. Where do you have bank accounts and belong to social, religious, professional and other organizations?

Voter registration, vehicle registration and drivers licenses count. Where you own or operate businesses counts, as does the relative income and time you devote to them. You can own investments far and wide, but you can expect them to be compared.

On the day President Obama was sworn in for his second term, [top professional golfer Phil] Mickelson sent shock waves through the Humana Challenge when he said the political landscape in the United States was causing him to seriously contemplate his future in golf.

[snip]

If you add up all the federal and you look at the disability and the unemployment and the Social Security and state, my tax rate is 62, 63 percent, Mickelson said. So Ive got to make some decisions on what to do.

[snip]

In December, Mickelson, who was part of a group that had bought the San Diego Padres four months earlier, abruptly announced that he was no longer involved in the business deal. His reversal came shortly after California voters approved Proposition 30, which imposed a 13.3 percent tax rate on incomes of more than $1 million.

Asked Sunday if the election results played a role in his decision to sever his ties with the Padres ownership group, Mickelson replied, Yeah, absolutely.

With home pricing rising here in the “technology” heart of California my wife and I have a plan to exit Northern California in the next 12 months and head to Central Texas for opportunity,lower taxes, and less government intrusion!

12
posted on 01/21/2013 7:49:07 PM PST
by RWAubrey
("Men sleep peacefully in their beds at night because rough men stand ready to do violence on their b)

1) Are you planning on relinquishing US citizenship? It isn’t that simple. You have the IRS to deal with.

2) Are you planning to make money in Panama? ( say, rent out a property )? You will of course have to report that income to the IRS.

American is one of a handful of countries that TAXES citizens on income from ALL POSSIBLE SOURCES.

If you are a German living and working in the US, you are not required to file the income you make in the US to the German tax office. If on the other hand, you are an American living and working in Germany, YOU ARE REQUIRED to report your income in Germany for taxation purposes.

In fact, I know of green card holders who became citizens later who left their country of origin and by some good fortune, inherited property or money from a dead relative from that country. THEY ARE REQUIRED TO INFORM THE IRS OF THAT.

I’m heading to the Philippines like some Freepers. Former American territory, kids were taught English the same time as tagalog and the newspapers are mostly in English. I also have dibs on a condo in the financial district and only paid 25K for the 27th floor (yeah, that cheap). The traffic though, is one of the worst.

17
posted on 01/21/2013 8:05:47 PM PST
by max americana
(Make the world a better place by punching a liberal in the face)

Are they still putting forth the idea of splitting CA into two states? I think the Northern population was pushing for it a while ago, but of course, the southern half needs the revenues to support the illegal population.

20
posted on 01/21/2013 8:12:37 PM PST
by RobertClark
("May God have mercy upon my enemies, because I won't" - George S. Patton)

Back in the early 90’s I was considering moving to Eureka, Ca. to be closer to my then girlfriend who had moved back home. I must say that staying in Texas and not marrying that girl was a very beneficial decision all around. PTL.

My plan was to becoem a mexian citizen, then sneak back across the boarder as an illegal alien so that I can get all the benifits that law abiding citizens are denied, and so I won’t ever have to buy a liscence to drive, have a pistol permit, or even file taxes- and so I can receive SS and medicare and have my college education paid for

I think I have finally convinced my husband to move. Our son started college at Texas A&M in the fall, and we have 16 year old twins. In state tuition in Texas is so much cheaper.

Plus, the housing costs and of course all the taxes.

I think we may rent our Cali home first, and rent out there.

I’m from Texas, but hubby is a Cali native and really doesn’t want to leave.

He lost his job last year after being diagnosed with prostate cancer. He’s got another job at a start up, but it doesn’t pay near as much. He doesn’t want to go back to a corporate job, and he can still work for the start up in Texas.

"No State shall, without the Consent of the Congress, lay any Imposts or Duties on Imports or Exports, except what may be absolutely necessary for executing it's inspection Laws: and the net Produce of all Duties and Imposts, laid by any State on Imports or Exports, shall be for the Use of the Treasury of the United States..."

My reading of this suggests that if you consider people themselves as exports, they can't be taxed beyond the cost of processing the move, and then any taxes that they do take goes to the federal government, not the state.

At least one can make the argument.

-PJ

38
posted on 01/21/2013 9:26:54 PM PST
by Political Junkie Too
(If you are the Posterity of We the People, then you are a Natural Born Citizen.)

Yeah, and I note that only 1% claim to leave because it’s too liberal, which is worrying as they are likely to bring their dammed liberalism with them to a red state and destroy it just as they destroyed California, and still haven’t got a clue. They’ve done just that to Virginia, North Carolina, Colorado, etc.

This entire exit tax and time frames of living in Cali when wanting to leave is BS.

Transfer your money/investments/assets to another State or Country (Cayman Islands) BEFORE you leave. I've read about many who did so and still get Cali Franchise Board dunning letters about taxes owed and they just ignore them. It may take a couple of letters to Franchise Board, but after a while they just give up.

If your money and assets are out of California, there is nothing they can do. Unless the Fedgov steps in, which they can't and won't, take your money and run and ignore California. Of course it gets complicated if you maintain a business or sale in Cali. But for the most part, yes, you can liquidate and take your assets elsewhere.

Yes, the Fedgov attempts to tax your income/profits while living out country as a USA citizen, but again, think off-shore accounts. I've been looking into once I leave this socialist state of Cali. Costa Rico, Cayman Islands, Bermuda, and a couple others don't inforce it. Surprisingly, Switzerland now has an agreement with the US about moneys transferred.

The Franchise Board may place a lien on your out of state property that includes escalating penalties and interest. I speak from experience. Do not ignore their letters; hire a mean dog CA tax attorney to fight them. If you are clean, the state will likely fold immediately if threatened with a counter-suit.

42
posted on 01/22/2013 2:46:57 AM PST
by Jacquerie
("How few were left who had seen the republic!" - Tacitus, The Annals)

And the fact that “too liberal” is only at 1% is the reason the rest of us despise most Cali emigrants. They come to another state and proceed to foul the nest there, not realizing the top 8 reasons are all the RESULT of “ too liberal”......

44
posted on 01/22/2013 3:23:16 AM PST
by Kozak
(The Republic is dead. I do not owe what we have any loyalty, wealth or sympathy.)

California government is a tax vampire. I never lived there, never worked there, and still had to write a lengthy letter to get them to leave me alone. My crime? I’m a Georgia resident who did some contract work for several months for a Georgia-based subsidiary of a Cali parent company. Then I moved to Arizona for a year to work as an FTE for an Arizona company. The tax vampires figured that was close enough. Unfortunately for them, I formerly practiced state and local tax law and know something about nexus and the Constitution.

California government is a tax vampire. I never lived there, never worked there, and still had to write a lengthy letter to get them to leave me alone. My crime? I’m a Georgia resident who did some contract work for several months for a Georgia-based subsidiary of a Cali parent company. Then I moved to Arizona for a year to work as an FTE for an Arizona company. The tax vampires figured that was close enough. Unfortunately for them, I formerly practiced state and local tax law and know something about nexus and the Constitution.

Try Cebu or Cagayan de Oro rather than Manila ,, much nicer places to live ... and remember , accounts in foreign currency (USD) have stricter privacy protections in the RP than you have in the Bahamas or Caymans.. If you earn anymoney make sure to filter it through a LLC or similar..

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